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| Subject: Debate Over Tax Cuts | |
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Author: WASHINGTON, Jan. 15 |
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Date Posted: 08:09:50 01/19/03 Sun http://www.nytimes.com/2003/01/19/politics/19MEMO.html In the Debate Over Tax Cuts, Both Parties See a Chance to Score Points By JOHN TIERNEY WASHINGTON, Jan. 15 — The aisles were packed at Politics and Prose, a bookstore in one of America's more affluent neighborhoods, when a billionaire's father arrived to promote his book calling for higher taxes on the rich. The customers there to buy copies of "Wealth and Our Commonwealth" loudly applauded William H. Gates as he denounced greedy plutocrats and declared the estate tax to be "the finest tax conceived by man." A quick survey of these book buyers from the Chevy Chase and Forest Hills sections of Washington found precisely zero percent in favor of the White House's proposed tax cuts. Echoing Democrats in Congress, they called it "unfair," "a giveaway to the rich," "a disaster." The closest encouraging word for the Bush plan came a few doors up Connecticut Avenue at Besta Pizza, a tiny carryout shop owned by an Egyptian immigrant, Tarek Zahow, who commutes to his 70-hour-a-week job from a much less upscale neighborhood 15 miles out of town. "Of course I'm for tax cuts," Mr. Zahow said. He said he supported the White House's proposal, even though he realized the affluent would receive most of the money, and favored eliminating the estate tax even if it applied only to millionaires. "I'm nowhere near a million in assets, but I might be someday," he said. "I don't think it's fair to have a tax for just a few people. Charge everyone the same." However irrational he may seem to Democrats, Mr. Zahow is just the sort of voter President Bush was addressing when he accused the critics of his tax plan of engaging in "class warfare." Populist appeals can work during tough economic times, as Franklin Delano Roosevelt demonstrated, but Republicans are betting that Mr. Zahow is more representative of today's voters than Mr. Gates's fans are. "Any time you have a tax cut, the majority of people will say it favors the rich, but so what?" said Matthew Dowd, a pollster who advises the White House and the Republican National Committee. "This issue just doesn't resonate with most Americans the way it does with the Democratic Party's activists and core constituencies." Republicans point to various surveys showing acceptance of tax breaks for the affluent. In a New York Times/CBS poll two years ago, 71 percent of the respondents opposed an estate tax even after being told it would apply only to estates above $1 million. Even when the threshold was raised to $3.5 million, in a poll last year, the tax was still opposed by 41 percent of Americans (with 54 percent in favor). Like Mr. Zahow, many voters say they can imagine this tax applying to them. While only 1 percent of Americans classified themselves as wealthy in a 1999 Newsweek poll, another 41 percent said it was "very likely" or "somewhat likely" that they would become wealthy. Other surveys show that Americans are much less prone to class envy than Europeans are, and more optimistic that they or their children will join the ranks of the affluent. "We have class wannabe but not class envy," said Frank Luntz, a Republican pollster. "The Democrats are using arguments that would work in Europe, because it's more of a status quo society, but we're still the Wild West of economies." Well-educated liberals in places like Chevy Chase often resent the fortunes made by their less-bright classmates, Mr. Luntz said, but the rest of America is less resentful. "Democrats keep expecting the working classes to rise up against the wealthy, but the Republicans are actually gaining in places like Kentucky and West Virginia while the Democrats are gaining in Beverly Hills and Greenwich, Connecticut," Mr. Luntz said. "If these new tax cuts were just for the rich, people would be upset, but as long as everyone gets some piece of the pie, working-class Americans won't begrudge the benefits going to others." Democratic pollsters acknowledge the perils of a populist appeal, but they insist it can work sometimes. Stanley Greenberg, a pollster for the presidential campaigns of Bill Clinton and Al Gore, said populist themes worked for Mr. Clinton in 1992 and helped Mr. Gore go from an 11-point deficit to a 5-point lead (and eventually a slim popular-vote majority) in the 2000 campaign. http://www.nytimes.com/2003/01/19/politics/19MEMO.html?pagewanted=2 In the Debate Over Tax Cuts, Both Parties See a Chance to Score Points (Page 2 of 2) "The Bush tax plan is a particularly narrow proposal that's easily caricatured," Mr. Greenberg said. "The Democrats ought to engage it in class terms, but that does not mean they are going to offer an angry populism." Guy Molyneux, a Democratic pollster who has been conducting a national poll for the A.F.L.-C.I.O. the past several days, said he had found only lukewarm support for he president's tax cuts. "This tax proposal reinforces the concern that he's the rich man's president," Mr. Molyneux said. "If the country is persuaded that the dividend tax cut will dramatically improve the stock market, that would be an important source of support for the plan, but I don't think that's going to happen." Even before his latest proposal, Mr. Bush was perceived by 51 percent of Americans as favoring the rich, according to a Gallup poll for CNN and USA Today completed Jan. 5. Forty-one percent said he was fair to all, an improvement over his father's 27 percent rating when the same question was asked during the elder Bush's losing presidential campaign of 1992. "This president has established a different reputation than his father, and class warfare won't play as well against him," said Karlyn Bowman, a resident fellow at the American Enterprise Institute, a conservative research group, and a co-author of the 1998 book "Attitudes Toward Income Inequality." "I've looked at four decades of polls, and I see no erosion in the belief that opportunity is present for those who are willing to work," she said. "Class warfare has the possibility to resonate when times are really tough, but I don't sense it has that much intensity right now. " The White House has been arguing that its plan would give less affluent workers some of the largest income-tax cuts when measured as a percentage of each worker's pay instead of in absolute dollars. But polls have traditionally shown that most Americans instinctively assume tax cuts go to the rich instead of to them. Even when many low-income workers were taken off the federal income tax tax rolls altogether in the 1980's, they still told pollsters that they would not benefit personally. Public opinion on the tax cuts will ultimately be decided by the economy, said Andrew Kohut, the director of the Pew Research Center, a polling institute. "In the 1980's people felt that Reagan's economic policy favored the rich, but it paid dividends for everyone, so the Democrats' criticism didn't cut it," Mr. Kohut said. "Today the public has reservations about the fairness of Bush's proposal, but if in the end it works to improve the economy, those reservations will be forgotten. If it doesn't, Bush will pay a price." Bush's Forum on Economy Is to Feature G.O.P. Donors By ELISABETH BUMILLER The speakers at a White House economic forum next week near President's Bush ranch will include major corporate donors to the Republican Party and a labor leader whom the administration is courting for support in the 2004 presidential campaign. The White House is billing the forum, which President Bush, Vice President Dick Cheney and at least seven members of the cabinet are to attend, as a diverse policy gathering of more than 200 economists, government officials, small investors, teachers, workers, corporate executives, small-business leaders and professors. White House officials said the participants would discuss the president's ''agenda to increase economic growth.'' Three of eight speakers announced by the White House today are chief executives of companies that have given generously to Republicans, said the Center for Responsive Politics, a nonpartisan group. The three are Charles Schwab, the chairman and chief executive of Charles Schwab Inc., which, with its executives, gave more than $406,000 in unrestricted soft money donations to the Republicans in 2000, and nothing to the Democrats; Glen A. Barton of Caterpillar, which gave $255,000 in soft money to the Republicans in 2000 and nothing to the Democrats; and John T. Chambers, the chief executive of Cisco Systems, which gave more than $435,000 in unrestricted party contributions to the Republicans in 2000 and $255,000 to the Democrats. A fourth speaker will be Douglas J. McCarron, the general president of the United Brotherhood of Carpenters and Joiners of America. The union has often backed Democrats, including Al Gore in the 2000 presidential campaign, but Mr. McCarron has developed warm relations with Mr. Bush, and White House advisers are pursuing his support for the president's re-election. A White House spokesman said this evening that no political considerations were involved in the invitations to speak. ''The speakers were selected because of their expertise and knowledge,'' the spokesman, Scott McClellan, said. ''And the attendees and participants represent a diversity of views.'' Senator Charles E. Grassley, Republican of Iowa, also defended Mr. Bush, saying the three executives were invited because of their background in investments, technology and manufacturing. ''I would doubt that the president would know who contributes to his campaign,'' Mr. Grassley said. ''I would imagine he called people from Charles Schwab because of the necessity of increasing confidence in the stock market.'' But other Republicans and conservative economists expressed skepticism today about the gathering. They said it appeared to be a show forum and public relations vehicle. ''It's purely political, purely P.R.,'' said Bruce Bartlett, a conservative economist who worked in the administrations of President Ronald Reagan and the president's father, President George Bush. ''There are a lot of times when really, quite frankly, there's nothing the president can do. But nobody wants to hear the president get on TV and say, 'I'm sorry, we're just going to have to tough it out.' This was something they planned out, and it looks good.'' Mr. Bartlett added, ''The people selected for this event are going to be very, very carefully chosen to make sure that nobody gets in there to start ranting and raving about how the Bush tax cut caused the recession. They'll tell the president what he wants to hear, and reaffirm his policies.'' The other speakers are Charles M. Vest, the president of the Massachusetts Institute of Technology, a Republican who has contributed to Senator Edward M. Kennedy, Democrat of Massachusetts; Tom Donohue, the president of the U.S. Chamber of Commerce, a Republican who has donated to Senator Robert G. Torricelli, Democrat of New Jersey; Michael Novak, a Democrat who is the director of social and political studies at the American Enterprise Institute, a conservative research organization; and Karen Kerrigan, a Republican who is the president and founder of the Small Business Survival Committee. The half-day forum is scheduled on Tuesday at Baylor University in Waco, about a half-hour's drive from the president's 1,600-acre ranch near Crawford, where he is spending a month. White House advisers, concerned about the economy's effect on Mr. Bush's political future, announced the gathering last month. Much of the forum was planned at the last minute. Some invitations went out as late as last Monday, leaving those invited to decide whether to abandon vacations for a day in Central Texas. Many decided to come. ''Are there perhaps P.R. effects that flow from an event like this?'' said Dirk Van Dongen, the president of the National Association of Wholesaler-Distributors and a leading Republican lobbyist. ''Sure. But that doesn't mean it's not worthwhile. I think it is worthwhile enough that I'm going down myself, and it's not because of Waco's climate.'' [ Next Thread | Previous Thread | Next Message | Previous Message ] |